CONSUMER ELECTRONICS ASSOCIATION, PETITIONER v. FEDERAL COMMUNICATIONS COMMISSION AND UNITED STATES OF AMERICA, RESPONDENTS. NATIONAL ASSOCIATION OF BROADCASTERS AND ASSOCIATION FOR MAXIMUM SERVICE TELEVISION, INC., INTERVENORS.
No. 02-1312
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 16, 2003 Decided October 28, 2003
On Petition for Review of an Order of the Federal Communications Commission
Jonathan Jacob Nadler argued the cause for petitioner. With him on the briefs were Joseph P. Markoski, David A. Nall, Angela M. Simpson, and David R. Siddall.
Bills of costs must be filed within 14 days after entry of judgment. The court looks with disfavor upon motions to file bills of costs out of time.
Donald B. Verrilli, Jr., argued the cause for intervenors. With him on the brief were Ian Heath Gershengorn and Robin M. Meriweather, Henry L. Baumann, National Association of Broadcasters (NAB), Jack N. Goodman, NAB, and Valerie Schulte, NAB, and David Donovan, Association for Maximum Service Television, Inc.
Before: GINSBURG, Chief Circuit Judge, ROBERTS, Circuit Judge, and WILLIAMS, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge ROBERTS.
ROBERTS, Circuit Judge: The Consumer Electronics Association (CEA) is a trade association representing businesses in the consumer technology industry, including designers and manufacturers of televisions, DVD players, and VCRs. CEA seeks review of a final order of the Federal Communications Commission (FCC or Commission) requiring that all televisions with a display of 13 inches or greater and certain other devices capable of receiving over-the-air television signals (such as certain DVD players and VCRs) include a tuner capable of receiving and decoding digital television (DTV) signals. See In re Review of the Commission‘s Rules and Policies Affecting the Conversion to Digital Television, 17 F.C.C.R. 15,978 (2002) (Digital Tuner Order or Order). CEA contends that the FCC lacks statutory authority to enact the Digital Tuner Order, and that, even if the FCC has such authority, the Order is an arbitrary and capricious abuse of it. Finding the Digital Tuner Order to be a reasonable exercise of the Commission‘s authority under the All Channel Receiver
I.
Since the 1940s, television stations have broadcast their programs over the air using an analog transmission standard adopted by the National Television System Committee (NTSC), and for almost all that time every television sold in the United States has contained an analog tuner designed to receive those NTSC signals and convert them into pictures and sound. Today, digital technology permits television content to be broadcast as streams of binary data bits, allowing broadcasters to transmit more information over a channel of electromagnetic spectrum than is possible through analog broadcasting. For example, an analog broadcaster can fit only one video and two or three audio signals into a 6 MHz broadcast channel; a DTV station can transmit up to four such programs simultaneously (along with CD-quality audio signals) across the same 6 MHz swath of spectrum. See In re Advanced Television Systems and Their Impact upon the Existing Television Broadcast Service, 10 F.C.C.R. 10,540, 10,541 ¶ 4 (1995) (Fourth Further Notice). Alternatively, a digital broadcaster can transmit the television program in high definition (HDTV) format — a wide-screen, ultra-high resolution picture with movie theater-quality surround sound — along with data such as program listings, sports scores, and stock prices. See id. Moreover, reception of over-the-air DTV broadcasts is less dependent on relative signal strength and more resistant to interference than analog broadcasts, yielding dramatically enhanced picture and sound quality. See In re Review of the Commission‘s Rules and Policies Affecting the Conversion to Digital Television, 15 F.C.C.R. 5257, 5266 ¶ 28 (2000) (Notice of Proposed Rule Making).
DTV also promises more efficient use of scarce electromagnetic spectrum. Currently, while over 400 MHz of spectrum is devoted to analog television broadcasting (enough for sixty-eight 6 MHz channels), the vulnerability of analog broadcasts to interference means that only a few channels actually can be used in any geographic area. See Fourth Further Notice,
In 1987, at the request of a coalition of television broadcasters, the FCC began to explore the possibility of using then-nascent digital technology to broadcast television programming. See Notice of Inquiry, 2 F.C.C.R. at 5125 ¶ 2. By 1997, the Commission had adopted a standard for DTV transmissions and had committed itself to the goal of abandoning analog broadcasting and switching all television broadcasts to DTV by the end of 2006. See In re Advanced Television Systems and Their Impact upon the Existing Television Broadcast Service, 12 F.C.C.R. 12,809, 12,850 ¶ 99 (1997) (Fifth Report and Order). Shortly thereafter, Congress adopted the Commission‘s goal as its own, stating that “[a] television broadcast license that authorizes analog television service may not be renewed ... for a period that extends beyond December 31, 2006.”
The FCC originally anticipated that market forces would drive consumers to want and manufacturers to provide tuners
The Commission found statutory authority for the Order in the All Channel Receiver Act,
Here, the Commission is faced with a similar problem — that is, the reluctance of the public to buy DTV receivers until there are DTV stations offering attractive DTV programs, and the lack of incentive for broadcasters to provide good attractive DTV programming in the absence of an audience which will attract advertisers. As Congress and the Commission found in the UHF context, requiring the manufacture of DTV receivers will address the root cause of the problem, namely the lack of television receivers capable of receiving DTV signals.
Id. at 15,990 ¶ 27.
The Commission acknowledged that it had, in earlier administrative proceedings, rejected calls for a digital tuner mandate, believing that market forces were sufficient to carry out the DTV transition. Id. at 15,993 ¶ 32; see also Fifth Report and Order, 12 F.C.C.R. at 12,855-56 ¶ 113. By 2002, however, with the statutory 2006 deadline fast approaching, the Commission had concluded that “insufficient progress is being made towards bringing to market the equipment consumers need to receive broadcasters[‘] DTV signals over-the-air.” Digital Tuner Order, 17 F.C.C.R. at 15,993 ¶ 33. The Commission decided that requiring digital tuners in all new televisions on a phased-in basis would “provide the best means for rapidly providing consumers with the means to receive the DTV signals that are now being transmitted by broadcasters while minimizing the impact of this requirement on equipment manufacturers and consumers.” Id. at 15,995 ¶ 39.
II.
A. Jurisdiction.
We are met at the outset with a suggestion that we lack jurisdiction to consider CEA‘s challenge. CEA — apparently not wanting the sun to set on the Digital Tuner Order unchallenged — filed its petition for review the very day the Order was published in the Federal Register. Shortly before oral argument, the FCC filed a letter noting that its rules provide that “the time for seeking review of documents in rulemaking proceedings begins the day after publication in the Federal Register.” Letter of FCC, Sept. 11, 2003 (emphasis added). Citing our decision in Adams Telcom, Inc. v. FCC, 997 F.2d 955 (D.C. Cir. 1993) and an unpublished order in Time Warner Entm‘t Co. v. FCC, No. 99-1500, 2000 WL 274211 (D.C. Cir. Feb. 8, 2000), the FCC surmised that its rules, as construed by our cases, “can be read to suggest that the Court lacks jurisdiction over a petition for review filed the day of Federal Register publication.” Letter of FCC, Sept. 11, 2003 (emphasis added).
As a court of limited jurisdiction, we take seriously any suggestion that we lack the authority to act — even one raised at the eleventh hour and not embraced as an argument but instead meekly noted. We begin our inquiry with the text. The rule cited by the Commission provides that “the first day to be counted when a period of time begins with an action taken by the Commission ... is the day after the day on which public notice of that action is given.”
Certainly this court lacks jurisdiction to entertain a prematurely filed petition. See Western Union Tel. Co. v. FCC, 773 F.2d 375, 378 (D.C. Cir. 1985);
An interpretation of Rule 1.4(b) that interposes a jurisdictional waiting period before one may seek judicial review is thus contrary not only to common sense, but to the text of
B. Statutory Authority.
Satisfied that CEA was not guilty of a false start, we turn now to its argument that the FCC had no authority under the All Channel Receiver Act,
When a litigant challenges the Commission‘s interpretation of a statute that it administers, our review is governed by the familiar dictates of Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43 (1984). “We start our analysis, as always, by asking whether Congress has spoken to ‘the precise question at issue.‘” Wells Fargo Bank, N.A. v. FDIC, 310 F.3d 202, 205 (D.C. Cir. 2002) (quoting Chevron, 467 U.S. at 842). To determine whether Congress has so spoken, we apply “traditional tools of statutory interpretation — text, structure, purpose, and legislative history.” Pharmaceutical Research & Mfrs. of Am. v. Thompson, 251 F.3d 219, 224 (D.C. Cir. 2001). If it has, “the inquiry is at an end; the court ‘must give effect to the unambiguously expressed intent of Congress.‘” FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 132 (2000) (quoting Chevron, 467 U.S. at 843). When the statute is silent or ambiguous on the precise question in dispute, we move to Chevron‘s second step, and defer to the agency‘s interpretation if it offers a “permissible construction of the statute.” Chevron, 467 U.S. at 843.
It is true, as CEA argues, that we “may examine the statute‘s legislative history in order to ‘shed new light on congressional intent, notwithstanding statutory language that appears superficially clear.‘” National Rifle Ass‘n v. Reno, 216 F.3d 122, 127 (D.C. Cir. 2000) (quoting Natural Resources Defense Council, Inc. v. Browner, 57 F.3d 1122, 1127 (D.C. Cir. 1995)). On the other hand, only rarely have we relied on legislative history to constrict the otherwise broad application of a statute indicated by its text, see, e.g., American Scholastic TV Programming Foundation v. FCC, 46 F.3d 1173, 1180 (D.C. Cir. 1995), and just recently we reiterated that “[w]hile such history can be used to clarify congressional intent even when a statute is superficially unambiguous, the bar is high.” The Williams Cos. v. FERC, No. 02-5056, slip. op. at 8 (D.C. Cir. Oct. 10, 2003). There is good reason for this; the Supreme Court has consistently instructed that statutes written in broad, sweeping language should be given
This case does not present the very rare situation where the legislative history of a statute is more probative of congressional intent than the plain text. CEA‘s lone example, American Scholastic TV, is inapposite. There we reviewed the Commission‘s interpretation of a now-repealed provision of the 1984 Cable Act. The provision in question stated that “[i]t shall be unlawful for any common carrier ... to provide video programming directly to subscribers in its telephone service area....”
American Scholastic TV is thus distinguishable for two separate and equally compelling reasons. First, in that case we relied on more than just legislative history; we also relied on the text of subsections neighboring the provision in dispute. Id. at 1179. CEA does not point to any similar provision in the Telecommunications Act indicating that ACRA is meant to apply only to analog broadcasting. Second, in American Scholastic TV, we found only that the
In any event, the legislative history invoked by CEA does not demonstrate that Congress meant to limit ACRA‘s application to the analog context. That history does show that Congress was most immediately concerned with empowering the FCC to address the problem of UHF reception. See, e.g., S. Rep. No. 1526, 87th Cong., 2d Sess. 2-4 (1962); H.R. Rep. No. 1559, 87th Cong., 2d. Sess. 2-5 (1962). But, as the Commission found in the Digital Tuner Order, nothing in the legislative history compels (or even suggests) the conclusion that Congress intended to limit the statute to that specific application. Digital Tuner Order, 17 F.C.C.R. at 15,989-90 ¶ 25.4 The use of broad language in ACRA — speaking only of “receiving all frequencies allocated by the Commission to television broadcasting,”
Because the FCC‘s interpretation is not foreclosed by Chevron step one, we proceed to the Chevron step two inquiry — whether the FCC‘s interpretation of the statute is reasonable. Here, however, CEA advances no additional argument beyond those already discussed as part of step one, and so we have no basis for finding the Commission‘s interpretation unreasonable. In any event, the language of ACRA plainly admits of the Commission‘s interpretation, and it therefore is a permissible construction of the statute.
C. APA Review.
We turn to CEA‘s arguments that the Digital Tuner Order runs afoul of the Administrative Procedure Act‘s requirements of reasoned decisionmaking. Under the APA, we may vacate the Commission‘s Digital Tuner Order only if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”
CEA contends that in the Order the FCC: (1) addressed a problem that does not exist; (2) chose an irrational means to ensure that households can access DTV; and (3) failed to
1. CEA first argues that digital tuners are presently commercially available in a quantity sufficient to meet the congressional timetable and that, therefore, the Digital Tuner Order, by ordering the manufacture of more digital tuners, seeks to solve a problem that does not exist. While it is true that the FCC must “do more than ‘simply posit the existence of the disease sought to be cured,‘” the Commission is entitled to “appropriate deference to predictive judgments that necessarily involve the expertise and experience of the agency.” Time Warner Entm‘t Co., 240 F.3d at 1133 (quoting Turner Broadcasting Sys. v. FCC, 512 U.S. 622, 664 (1994)).
The Commission is not crying wolf. Widespread ability among consumers to receive DTV signals is a prerequisite to meeting Congress‘s 2006 target date for the completion of the DTV conversion and the cessation of analog broadcasting. See
The FCC found that a logjam was blocking the development of DTV: broadcasters are unwilling to provide more DTV programming because most viewers do not own DTV equipment, and the lack of attractive DTV programming
2. Pointing out that 85 percent of households receive television service from a cable or satellite provider, CEA next argues that a requirement that all televisions include an over-the-air tuner is not a rational means to promote DTV conversion. CEA argues that the Digital Tuner Order forces cable and satellite households to purchase a digital tuner they do not want and will not use. This argument fails. First, as a general matter, the very nature of the authority conferred by ACRA assumes that the Commission may impose costs on consumers for features they do not want. For some consumers, that is doubtless the consequence of the transition from analog to DTV itself. That transition is not a market-driven migration to a new technology, but rather the unambiguous command of an Act of Congress. See
The Commission reasonably determined that a phased-in requirement that all televisions contain a digital tuner would necessarily increase production volumes and, through economies of scale, lower the price of digital tuners for all television purchasers. See id. at 15,995 ¶ 39 (“prices are declining and will decline even faster as economies of scale are achieved with increasing volumes of production and production efficiencies are introduced over time“). This will make the purchase of DTV equipment more attractive to consumers generally, and help break the logjam discerned by the Commission. CEA objects that this is requiring cable and satellite viewers who do not need over-the-air DTV tuners to saddle some of the cost of making the tuners more affordable for those who do, but such a shifting of the benefits and burdens of a regulation is well within the authority of the responsible agency.6
3. Finally, CEA argues that the Commission unreason-ably assessed the costs of the digital tuner requirement to consumers. CEA maintains that when the Commission was faced with broadly differing estimates of the unit cost of a digital tuner, it failed to make any independent assessment of
For as long as the Commission has managed the DTV transition, it has gathered information concerning economies of scale. See In re Advanced Television Systems and Their Impact upon the Existing Television Broadcast Service, 7 F.C.C.R. 3340, 3354 ¶ 53 & n.154 (1992) (citing comments from electronics manufacturers for the proposition that by the conversion date “the cost of [advanced] receivers should have declined from the level of initial prices, as a result of increased consumer acceptance and higher volume sales“); Advanced Television Systems and Their Impact upon Existing Television Broadcast Service, 7 F.C.C.R. 6924, 6958 ¶ 45 & n.161 (1992) (citing broadcast industry studies to state “equipment costs [will] decline as a result of production scale and learning curve economies“); Fourth Further Notice, 10 F.C.C.R. at 10,548 ¶ 51 (“Given the degree of competition that exists between suppliers of electronic equipment, and expected economies of scale resulting from the proliferation of digitally based media, we anticipate that declining costs will translate into reduced prices and increased sales of digital receivers and converters to consumers.“).
It was against this backdrop that the Commission, in the Further Notice of Proposed Rulemaking that immediately preceded the Digital Tuner Order, sought comments on “the initial projected costs of [the digital tuner] requirement as well as realistic estimates of those costs over time.” Further Notice of Proposed Rulemaking, 16 F.C.C.R. at 5985 ¶ 107. As to the initial cost of including digital tuning capability in television sets, the Commission received comments from manufacturers and broadcasters with estimates ranging from $169 to $250. See Digital Tuner Order, 17 F.C.C.R. at
The Commission was thus left with long-term estimates of the incremental cost of a digital tuner ranging from $50 to $75, each offered up by an entity involved in the manufacture of digital tuners. The Commission did not subject these estimates to much in the way of rigorous analysis. But given the history of rapidly declining prices in other consumer electronic markets, and because CEA never pointed out possible biases of the commenting firms or presented affirmative evidence supporting its own $200 estimate, we cannot say that it was unreasonable for the FCC to conclude — on the basis of admittedly imperfect evidence and inherent uncertainty — that the costs of a digital tuner would likely fall to $50-$75 by 2007. See AT&T v. FCC, 832 F.2d 1285, 1291 (D.C. Cir. 1987) (“When ... an agency is obliged to make policy judgments where no factual certainties exist ... we require only that the agency so state and go on to identify the considerations it found persuasive.” (internal quotation marks omitted)). We therefore defer to the Commission‘s predictive judgment. See Melcher v. FCC, 134 F.3d 1143, 1151, 1152 (D.C. Cir. 1998) (“our review of the FCC‘s exercise of its predictive judgment is particularly deferential” because where “the FCC must make judgments about future market behavior with respect to a brand-new technology, certainty is impossible“).
Having adequately estimated the long-range costs of the digital tuner mandate within a range sufficient for the task at hand, the Commission assessed the benefits of the Order —
The petition for review is denied.